Core Viewpoint - Red Star Cold Chain (Hunan) Co., Ltd. has submitted an IPO application to the Hong Kong Stock Exchange after a previous application lapsed. The funds raised will be used for building a new processing plant, upgrading existing equipment, strategic acquisitions, and general corporate purposes [1][12]. Group 1: Company Performance - Over the past three and a half years, key performance indicators at the company's two bases in Changsha have declined, with the number of customers at the northern base dropping by 91.76% [1][7]. - The company has paid out a total of 240 million RMB in dividends over the past three and a half years, primarily benefiting the controlling shareholder, who holds over 70% of the company [1][13]. - Red Star Cold Chain reported revenues of 237 million RMB, 202 million RMB, 234 million RMB, and 118 million RMB for the respective periods, with net profits of 79.1 million RMB, 75.3 million RMB, 82.9 million RMB, and 39.7 million RMB [8][9]. Group 2: Business Operations - The company primarily operates in cold storage services, which accounted for 68.8% of its revenue in the first half of the year [2][8]. - The utilization rate of the southern base's storage capacity decreased from 98.9% to 88.2%, while the average monthly cold storage fee per ton fell from 79.4 RMB to 70.7 RMB [5][7]. - The northern base experienced a more severe decline, with customer numbers dropping from 279 to 23, leading to a utilization rate decrease from 85% to 45.9% [7][10]. Group 3: Financial Health - The company has faced liquidity issues, with current liabilities exceeding current assets in 2023 and 2024, resulting in current ratios below 0.6 [10][11]. - The total non-current assets were valued at 772.7 million RMB in 2022, increasing to 1.1 billion RMB in 2023, while current assets were 161.9 million RMB in 2022 and 129.9 million RMB in 2023 [11][12]. Group 4: Risks and Challenges - The company has acknowledged risks related to supplier concentration, with the top five suppliers accounting for 78.1% to 90.6% of total procurement over the years [10]. - Red Star Cold Chain has also been noted for its failure to pay employee social security and housing fund contributions, accumulating a total of 16.8 million RMB in unpaid amounts [1][13].